Nigeria raises oil output to 1.53m bpd as 3m target remains distant

Nigeria’s crude oil production rose to 1.53 million barrels per day (bpd) in September, but output remains far below the government’s ambition of reaching three million bpd by 2030, limiting the scale of potential gains in export earnings and public revenue.

The Organisation of the Petroleum Exporting Countries (OPEC), in its monthly oil market report released on Tuesday, said Nigerian production increased by 2 per cent from 1.50 million bpd in August, extending a period of output recovery.

However, the latest increase masks a relatively flat production trend over the past two quarters. Nigeria’s crude output averaged 1.512 million bpd in the third quarter of 2026, down slightly from 1.525 million bpd in the second quarter, although it improved substantially from 1.388 million bpd in the first quarter.

The figures show that while production has recovered from the weak levels recorded early in the year, Nigeria is yet to establish a sustained upward trajectory capable of significantly expanding its oil revenue base.

For an economy still heavily dependent on crude exports for foreign exchange and government income, the difference between producing 1.5 million barrels and approaching three million barrels daily is substantial. Higher output could increase export receipts, strengthen external reserves and provide additional resources for government spending, provided production costs and other deductions do not absorb the gains.

Nigeria’s production performance has improved over a longer period, rising from an average of 1.345 million bpd in 2024 to 1.432 million bpd in 2025. The stronger showing in 2026 suggests some recovery, but the latest quarterly figures indicate that sustaining the momentum remains a challenge.

The revenue outlook is also complicated by developments in the international oil market. OPEC has cut its forecast for global oil demand growth in 2026 from 1.4 million bpd to 400,000 bpd, a reduction of more than 70 per cent, reflecting weaker-than-expected demand growth.

Although crude prices can rise when supply is disrupted, slower demand growth could limit the sustainability of prices and increase uncertainty around export earnings. Nigeria therefore faces a dual challenge: raising production while navigating a less predictable global market.

The government is targeting three million bpd by 2030, with the Nigerian Upstream Petroleum Regulatory Commission using licensing rounds and efforts to attract investment as part of its strategy to increase output. Progress will depend on new capital, improved security, reduced production disruptions and the timely development of oil and gas assets.

Data from the NUPRC also showed that combined crude oil and condensate production rose to approximately 1.678 million bpd in August, up 0.4 per cent from the previous month. That figure is higher than OPEC’s crude-only measure because it includes condensates, which are excluded from Nigeria’s OPEC crude production quota.

Nigeria’s latest production increase provides some encouragement, but the relatively narrow quarterly movement shows why a sustained recovery matters more than a single month’s gain.

For the Federal Government, stronger oil production remains central to improving fiscal capacity and foreign exchange supply. The real test will be whether Nigeria can consistently bring additional barrels to market, attract investment into new capacity and reduce disruptions enough to turn its production ambitions into dependable national revenue.